Boyd, Station Casinos Move Forward with Online Poker Plans

Next stage could mark US re-entry for BwinParty

by , Oct 6, 2012 | 10:00 am

Boyd Gaming Corp. and Station Casinos, fierce competitors in the locals casino market, could soon take their rivalry to the Internet.

Affiliates of the two companies were tentatively approved Wednesday to operate online poker websites within Nevada’s boundaries by the Gaming Control Board. The Nevada Gaming Commission will take up the matter Oct. 18.

The companies may launch their poker operations at different times. The sites can be accessed only from computers and mobile devices within Nevada’s borders.

Boyd Gaming officials said they will wait until the company’s online partner, bwin.party gaming, is licensed by state gaming regulators. Ultimate Gaming, a subsidiary of Fertitta Interactive, which is controlled by the founders of Station Casinos, plans to launch a Nevada gaming site as soon a technology achieves the various levels of approval.

Both companies believe they will be successful in Nevada but favor federal approval of online poker that would allow the companies to expand into other states.

Boyd Gaming Executive Vice President Bob Boughner told the control board the company could double the $132 million Nevada casinos collected in revenue from live poker rooms in 2011.

Boughner said Boyd has “one-and-a-half” employees now dedicated to the online poker effort, but could expand to 20 to 30 jobs once the system goes live.

Boyd and MGM Resorts International signed separate understandings with United Kingdom-based bwin.party last year, but much of the interest is on the federal legalization of Internet poker.

“We’re hopeful that other casino games could also be legalized online,” Boyd Gaming Senior Vice President Kevin Sullivan said.

Bwin.party is the parent company of PartyPoker, which had accepted wagers from American customers before the Unlawful Internet Gaming Enforcement Act was passed in 2006.

PartyGaming suspended all real-money gaming business with U.S. customers and exited the market after the act was passed. Three years later, PartyGaming signed a nonprosecution agreement with the U.S. Department of Justice and paid a $105 million fine for offering Internet gambling to U.S. customers before the act’s passage.

The settlement cleared PartyGaming from being prosecuted for any of its activities relating to its U.S operations.

Ultimate Gaming Chairman Tom Breitling told the control board that CyberArts, an online gaming technology company that was purchased by Fertitta Interactive, never accepted wagers from U.S. customers before or after act’s passage.

“Poker must be played in full transparency,” Breitling said, “and in the past, online companies operated in the shadows.”

Station Casinos briefly operated at online gaming site licensed in the Isle of Man in 2000 but never accepted wagers from Americans.

Ultimate Gaming, which is also affiliated with the Fertitta controlled Ultimate Fighting Championship, now has 20 employees and could have 100 workers once a real-money poker website is established.

In other action, the control board gave tentative approval to Navegante Gaming to take over operations of the LVH, which is expected to be sold at foreclosure at the end of the month to its lenders.

Navegante, which is controlled by longtime gaming executive Larry Woolf, would take over operations of both the casino and the 3,000-room hotel on Nov. 1 if approved by the gaming commission and if the foreclosure sale is completed.

Goldman Sachs Mortgage would own 70 percent of the LVH and Gramercy Capital Corp. would own the other 30 percent. The hotel was formerly known as the Las Vegas Hilton.

Ron Johnson, the court-appointed receiver for LVH, said hotel occupancy declined by 30 percent when the property lost its Hilton Hotels reservation system connection after a marketing agreement expired. However, occupancy has since climbed back into the 70 percent range.

He said expenses were cut by 22 percent but 200 employment positions were eliminated. The property now has 2,263 workers.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Follow @howardstutz on Twitter.
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